Why Solar Property Tax Exemptions Matter
More than half the states in the country offer some type of solar property tax exemption. This is important is because a solar installation can add tens of thousands of dollars to the value of your house. You should be aware of how solar may affect your property taxes in the future because property taxes are something you pay every year. An increase in property taxes would add up over time.
How much value does solar add to a home?
It makes sense that a solar installation will add value to your home. Experts say the ratio of increased home value to annual electricity bill savings is 20:1. This means if your bill is reduced $1,000 a year, the value of your home should be raised by $20,000! The idea behind this is that once solar is in place, the operating costs for the home will decrease because of the smaller electric bills. In theory, the monthly savings can go towards paying a larger mortgage payment instead of an electricity bill. If an average solar installation will increase your home value by $20,000, your property will be assessed a higher value.
Will your property taxes go up after solar?
Not necessarily. 32 out of 50 states are rewarding homeowners for making an investment in clean, green energy and helping them get to their Renewable Portfolio Standard by offering some type of property tax exemption.
Does your state offer a solar property tax exemption?
17 states, including Connecticut, New Jersey, and New York, offer a 100% property tax exemption for solar indefinitely. 15 other states provide a limited period of full property tax exemption, partial property tax exemption, or some other type of benefit. For example, Massachusett gives residents a 100% property tax exemption for the first 20 years after the solar project is complete and Rhode Island agrees to not assess a solar photovoltaic system more than the value of a conventional energy system.
Does a solar property tax exemption mean you pay no property taxes?
I actually get this question more a lot. You will still pay property taxes, but the value of the solar will be excluded and this means your property taxes won’t increase.
For a full table of property tax exemptions by state and other great solar-related data, please refer this article on tax exemptions on SolarPowerRocks.com. Brightstar Solar is a Massachusetts solar company that can help you navigate local incentives and permitting rules. Unlike other installers, we are there for customers post-installation, including solar tax planning as well as repairs and warranty issues. Please reach out us at 617-564-0050 if you would like a free solar consultation of your home or business in Massachusetts.